10. Resource Markets
Lecture Notes
1. Resource Market Complications:
a. Resource markets are often heavily regulated, particularly capital and
labor markets.
b. Because labor (human beings as a factor of production) and private
property are involved in resource markets there tends to be more
controversy concerning these markets.
2. The demand for all productive resources is a derived demand. By derived
demand it is meant that it is the output of the resource and not the resource itself
for which there is a demand.
a. marginal product is MP = ÎTP/ÎL where L is units of labor, (or K for
capital, etc.
b. marginal revenue product is MRP = ÎTR/ÎL
3. Demand Curve:
56
Lecture Notes
1. Resource Market Complications:
a. Resource markets are often heavily regulated, particularly capital and
labor markets.
b. Because labor (human beings as a factor of production) and private
property are involved in resource markets there tends to be more
controversy concerning these markets.
2. The demand for all productive resources is a derived demand. By derived
demand it is meant that it is the output of the resource and not the resource itself
for which there is a demand.
a. marginal product is MP = ÎTP/ÎL where L is units of labor, (or K for
capital, etc.
b. marginal revenue product is MRP = ÎTR/ÎL
3. Demand Curve:
56
